Sunday, July 24, 2011

"Much attention has been paid to the forces at work against the foundation, but in fact the seeds of destruction were sown by the hands of Barnes himself."

James Panero has the cover story in the new issue of Philanthropy magazine on the Barnes Foundation. He says it's "been a case study in how an institution . . . can become irrevocably damaged through overly restrictive operating guidelines, unanticipated leadership problems, and the competing missions of other organizations and institutions."

Overall, he seems to fall into the wish-they-weren't-moving camp, but it's a much more balanced picture than we're used to getting. For example, he notes that "it is not exactly clear to what extent Pew, Annenberg, or Lenfest are obligated to defer to the wishes of Albert Barnes. Donors, whether individual or institutional, pursue a wide variety of causes. In a free society, many of those causes will be mutually exclusive. Barnes wanted his collection intact and in Merion. Pew, Annenberg, and Lenfest want to make downtown Philadelphia a center for world-class art. Both goals are perfectly legitimate—indeed, on their own, entirely admirable." (It's much easier to just call those groups -- who "offered $150 million in private and public funding" -- THIEVES.)

Nevertheless, he says "their actions undermine the general principle of donor intent. They set a precedent that could discourage future donors from believing that their intent will be honored. All philanthropy involves an act of trust between giver and recipient. These actions erode that sense of trust, to the detriment of future philanthropy."

But as I've said before, it's built into the structure of our laws governing philanthropy that, if circumstances change significantly enough in the future, donor intent may be modified. That was the case before Barnes established his foundation, and remains the case today. We simply can't guarantee donors that, no matter what happens, their intentions will always be honored. But we still get plenty of philanthropy.

In fact, in the case of Barnes, don't the incentive effects actually run in the other direction? Do we want the message to potential donors to be, no matter how poorly you structure your gift, no matter how "overly restrictive [your] operating guidelines," no matter how ill advised your investment limitations, we will never violate your intentions? Doesn't the moving of the Barnes in fact send exactly the right message to future donors?